SND to PVL: Five penny energy stocks to watch in Q2

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SND to PVL: Five penny energy stocks to watch in Q2

SND to PVL: Five penny energy stocks to watch in Q2
Image source: © Digitalpress | Megapixl.com

Highlights 

  • Blueknight Energy Partners L.P. (NASDAQ: BKEP) has a P/E ratio of 2.33, with a dividend yield of 3.73%.
  • Martin Midstream Partners L.P. (NASDAQ: MMLP) has a P/E ratio of 20.23, with a dividend yield of 0.45%.
  • Permianville Royalty Trust’s (PVL) dividend yield is 81% with a dividend of US$0.378.

The energy sector has benefitted from the high oil prices following the Russia-Ukraine war. Energy companies are engaged in producing, storing, refining, distributing, and selling energy.  

Companies whose share price is not more than US$5 are called penny stocks. Also, these companies have a market capitalization of less than US$300 million.  

Investments in penny stocks are deemed risky because of their limited capacity to withstand market swings. However, they offer tremendous growth potential compared to their larger peers.  

As a result of the war, energy prices soared to a record high, and to stop further price rises, President Biden, on March 31, announced to release at least one million barrels of crude daily (BPD) from the emergency reserve for six months starting in May. 

Here, we discuss five penny energy stocks that returned 35% gains year-to-date. 

Smart Sand, Inc. (NASDAQ: SND)

Market Capitalization: US$194.9 million

The Woodlands, Texas-based Smart Sand Inc is a fully integrated frac sand supply and services company. The company produces Northern White frac sand. Its product portfolio includes Smart System. Most of its revenue comes from Sand Sales and logistics.

The company will release its first-quarter results on May 11, 2022. For the fiscal year ended December 31, 2021, its revenues were US$126.6 million compared to US$122.3 million for fiscal 2020, reflecting a 4% increase YoY. The increase was due to higher volumes sold. The company sold 3,189,000 tons in FY2021 compared to 1,886,000 tons in FY2020. 

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Its net loss came in at US$50.7 million or US$1.21 per diluted share compared to a net income of US$38.0 million or US$0.94 per diluted share in fiscal 2020. The net cash from operating activities was US$32.4 million for FY2021. 

The SND stock traded in the range of US$4.95 US$1.73 in the last 52 weeks. The stock closed at US$4.35 on April 29, 2022. 

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SND to PVL: Five penny energy stocks to watch in Q2

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Blueknight Energy Partners L.P. (NASDAQ: BKEP)

Market Capitalization: US$190.9 million 

Blueknight Energy provides storage and distribution services to support domestic transportation infrastructure markets. The company is located in Tulsa, Oklahoma. 

On April 22, Blueknight entered into a definitive merger agreement with Ergon Inc under which its affiliate will acquire all outstanding shares of Blueknight Partnership. 

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Its Q1 results will be declared on May 4.

The company reported revenue of US$115.4 million in the fiscal year ended December 31, 2021, compared to US$110.2 million in the previous year. 

Its net income was US$110.5 million or US$1.96 per share diluted compared to a net loss of US$13.48 million or US$0.91 per share diluted in fiscal 2020.

The stock traded in the range of US$4.60 to US$3.00 in the last 52 weeks. It has a P/E ratio of 2.33 and a dividend yield of 3.73%. the BKEP stock closed at US$4.56 on April 29. 

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Martin Midstream Partners L.P. (NASDAQ: MMLP)

Market Capitalization: US$172.89 million

Kilgore, Texas-based Martin Midstream Partners’ businesses include terminals, processing plants, storage, and packaging services for petroleum, chemical, and natural gas products. 

For the quarter ended March 31, 2022, it reported revenue of US$279.2 million compared to US$200.97 million in the previous year. Its net income was US$11.48 million compared to US$2.45 million in the March quarter of 2021. 

The stock traded in the range of US$5.98 to US$2.02 in one year and closed at US$4.45 on April 29, 2022. Its P/E ratio is 20.23, and its forward P/E for one year is 89.0. Its dividend yield is 0.45%, and the annualized dividend is US$0.02.

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Hallador Energy Company (NASDAQ: HNRG)

Market Capitalization: US$131.14 million 

Hallador Energy is a coal mining company based in Terre Haute, Indiana. Besides generating electricity, it invests in oil and gas companies.

For the fiscal year ended December 31, 2021, it generated revenue of US$247.7 million compared to US$244.2 million in the previous year. It posted a net loss of US$3.75 million or US$0.12 compared to US$6.22 million or US$0.20 per share diluted in fiscal 2020.

It reported an operating cash flow of US$48 million in fiscal 2021 and paid back bank debt of US$26 million. 

The HNRG stock traded in the range of US$6.17 to US$1.99 in the last 52 weeks. The stock closed at US$4.26 on April 29, 2022.

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SND to PVL: Five penny energy stocks to watch in Q2© Yurok | Megapixl.com

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 Permianville Royalty Trust (PVL)

Market Capitalization: US$105 million

Houston, Texas-based Permianville Royalty Trust is a statutory trust. The trust earns profits from oil and natural gas sales.

Its reported sales of US$43.47 million for the fiscal ended December 31, 2021, compared to US$23.37 million in FY 2020. Its distributable income came in at US$3.12 million compared to US$US$5.02 million in the fiscal year 2020.

The stock traded in the range of US$3.49 to US$1.52 in the last 52 weeks and closed at US$3.2. It has a dividend yield of 11.81% with an annualized dividend of US$0.378.

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Bottom line:

Invesco S&P SmallCap Energy ETF (PSCE) has outperformed the overall market and generated approximately 40% YTD, whereas S&P 500 Index lost around 13% in the same period. 

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